Whether an employee is exempt or non-exempt is determined by reviewing the criteria set forth under the federal Fair Labor Standards Act (FLSA).

Most employees are non-exempt meaning they must be paid for all hours worked and are subject to overtime and minimum wage requirements prescribed by the FLSA and the state of IL.

Exempt employees receive a fixed predetermined salary for any week during which work is performed regardless of the quantity or quality of such work. Exempt employees are excluded from overtime pay provisions.

To be exempt, an employee must pass all three “tests”, salary level, salary basis, and duties, as outlined by the FLSA.

Employees who are paid less than $455 per week are non-exempt. It’s worth noting that the federal Department of Labor’s new overtime rule that increased the salary level to $913 per week as of December 1, 2016 has been blocked. The new rule could still be implemented in the future but as of now it’s on hold.

An exempt employee must receive a regular, predetermined amount of compensation each pay period on a weekly, or less frequent, basis. Aside from a few exceptions, an employee must receive the full salary for any workweek during which the employee performs any work, regardless of the number of days or hours worked.

An employee who meets the salary level and salary basis tests is exempt only if he/she also performs exempt job duties. The actual tasks of the job are to be evaluated, not the job title. Exempt employees are employed as bona fide executive, administrative, professional and outside sales employees.

Job duties are exempt “executive” job duties if the employee regularly supervises two or more other employees, has management as the primary duty of the position, and has some genuine input into the job status of other employees (such as hiring, firing, promotions, or assignments).

“Professionally” exempt work is predominantly intellectual, requires specialized education, and involves the exercise of discretion and judgment. Advanced degrees are the most common measure of this but are not absolutely necessary if an employee has attained a similar level of advanced education through other means and performs essentially the same kind of work as similar employees who do have advanced degrees.

Further, the creative professional employee exemption applies to an employee whose primary duty is the performance of work requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.

“Administratively” exempt employees provide support to the operational or production employees and have a major impact on the overall business. An administratively exempt employee has the authority to create or interpret company policies, has responsibilities that directly relate to the overall business operation, has the decision making ability to make significant financial impacts, and has the authority to deviate from company policy without prior approval.

An employee who doesn’t pass all three tests is considered non-exempt under the FLSA.

Usually, TAs are non-exempt. However, exempt status cannot be determined simply by the job title. All of an employee’s job duties and the qualifications needed to perform the job must be considered.

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